NCDRC | Can allottees refuse to accept possession of flat even after receiving Occupation Certificate, even if there is delay in said offer? Does this lead to termination of contract? Read more

National Consumer Disputes Redressal Commission (NCDRC): Deepa Sharma (Presiding Member) addressed a matter wherein a consumer was subjected to the agony of delayed possession of a flat by being duped and coerced by the project owner.

Factual Matrix

Complainant 3 had booked a flat in Garden Isels project of the OP and the possession was to be handed over within 42 months, i.e. 3 and a half year, for which he had taken a home loan and had paid an EMI.

OP duped the complainant when he complained of the delay in construction, when OP suggested the complainant of buying another flat. Afterwhich, complainants had bought a flat in the project Imperial Courts and in 2015, an allotment letter was issued, and OP promised to hand over the possession within 24 months.

Further, it was contended that in one month of October, 2015, the Complainant as per the plan and advice of OP sought cancellation of the purchased unit in Garden Isels and requested for the transfer of the amount in the account of Imperial Courts flat.  It was stated that due to the transfer of the said amount, complainant lost home loan monthly EMI paid for over 25 months, 5% deduction on cancellation of the unit and the late payment amount of 2 to 4 Lakhs calculated @ 12% p.a. on the late payment of the installments and this amount comes to approximately 14 to 16 Lakhs and it is recoverable from the Opposite Party along with compensation for harassment and mental agony.

OP was paid total sale consideration amount and as per the possession letter, the flat was to be handed over within 45 days, i.e. by 15th February, 2017. However, series of unfortunate events took place. It was submitted that OP informed the complainants about the shortage of material and therefore informed them that it would take a long time for them to install 7 ACs one Jacuzzi, well-furnished modular kitchen and wardrobes in all four bedrooms.

On the advice of the OP, the Complainants under duress decided to give up all the materials like installation 7 ACs, one Jacuzzi, well-furnished modular kitchen and wardrobes in all four bedrooms and for that purpose, the Opposite Party had given a discount of 4,72,900, while the actual cost of all those articles were more than 15 Lakhs.

It was submitted that the OP had done nothing to ensure the handing over of the possession of the Imperial Courts flat.

The agreement between the parties was biased and contrary to the settled principle of law and public policy, hence, the agreement could not be implemented in the present form. The Complainants were induced to enter into this agreement which OP now sought to enforce.

OP was forcing the complainants to take possession of a flat that was not proposed and the overall condition of the project was not what was represented. Therefore, the agreement stood breached and deserved to be cancelled.

Analysis, Law and Decision 

Crux of the problem was that the flat was to be handed over within 42 months plus 6 months of a grace period, i.e. within 4 years. Before the expiry of 4 years, the complainant had booked a flat at the other project of OP for which the allotment letter was handed over and possession was promised within 24 months.

Coram stated that it is a settled proposition of law that if somebody complaints inducement, force or coercion it is his duty to plead the facts which led to said inducement, coercion or force and thereafter, prove those facts.

It was noted by the Commission that the complainants acted voluntarily and during the existence of an allotment of their flat in Garden Isles project, they booked another flat in Imperial Courts and finding difficult in paying installments towards Imperial Courts flat, they sought cancellation of the allotment of the flat in Garden Isles even before the period within which the possession of the said flat was to be handed over to them and requested for transfer of the money paid against the said flat in the account of Imperial Courts.

When can possession of a flat not be refused?

Commission while referring to the decision of the Supreme Court in Ireo Grace Realtech (P) Ltd. v. Abhishek Khanna, (2021) 3 SCC 241 expressed that where the offer of possession is made along with Occupation Certificate, even if there is a delay in the said offer, the allottees cannot refuse to take the possession.

In light of the above facts and contentions of the matter, Coram held that there was no delay in the offer of possession and complainants since failed to give any valid reason and there existed no valid reason for the complainants to refuse to take possession and terminate the contract, the refusal to take possession is hence not justifiable.

Therefore, Complainants have failed to prove any fact on record to show that the OP had adopted an unfair trade practice or that the agreement was biased or one-sided. [Sudha v. Jaiprakash Associates Ltd., 2021 SCC OnLine NCDRC 166, decided on 29-04-2021]


Advocates before the Commission:

For the Complainant: Nakul Singh Pathania, Advocate

For the Opp.Party: Sukumar Pattjoshi, Sr. Advocate With Sumeet Sharma, Advocate

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